In order to assure timely and orderly reimbursement, healthcare providers need to be compliant with the Health Insurance Portability and Accountability Act (HIPAA) (Harrington, 2020). Insurance companies, Medicare, and Medicaid, reimburse expenses based on the coded information about the diagnosis and performed procedures. Currently, care providers utilize ICD-10 diagnosis codes that include more than 70,000 modifiers developed and maintained by the World Health Organization (LaPointe, 2018). However, these groups are used for diagnostic groups only. For procedures, hospitals utilize Current Procedural Terminology (CPT) codes and the Healthcare Common Procedure Coding System (HCPCS) (LaPointe, 2018). CPT and HCPCS often overlap; however, HCPCS codes can describe non-physician services, such as ambulance rides, durable medical equipment use, and prescription drug use (LaPointe, 2018). Thus, CMS requires care providers to submit claims using HIPAA, while private payers ten to use CPT together with ICD (LaPointe, 2018).
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The fact that there is no unified system accepted by all stakeholders at least inside the US, different coding regulations are associated with confusion. Confusion is often related to financial losses or prolonged reimbursement period. Since not all care providers utilize automated claim procession, hospitals need to hire and maintain significant billing staff, which is associated with considerable cost. However, the transition to automatic claim procession is also associated with significant capital investments and does not guarantee a flawless reimbursement process. Thus, healthcare managers and executives need to pay close attention to coding and billing regulations and look for cost-efficient ways to maximize compliance.
Harrington, M. K. (2020). Health care finance and the mechanics of insurance and reimbursement. Jones & Bartlett Learning.
LaPointe, J. (2018). Exploring the fundamentals of medical billing and coding. RevCycle Intelligence. Web.